Sensex begins reverse trend, slumps over 600 points to below 66K mark

The BSE Sensex plummeted greater than 600 points on Wednesday morning to fall below the 66,000 mark. Currently, it’s buying and selling down 628 points at 65,830 points, bringing the upward pattern to naturally revert to its unique power.

Twenty-seven shares out of Sensex 30 have been within the purple, with NTPC and Tata Steel down greater than 2 per cent. V.Okay. Vijayakumar, Chief Investment Strategist at Geojit Financial Services. mentioned the most important information after market shut yesterday is the ranking company Fitch’s downgrade of US sovereign ranking from AAA to AA+.

This has impacted bond and forex markets with the US 10-year yield rising above 4 per cent. Paradoxically, throughout uncertainties greenback’s protected haven standing improves even when when the downgrade is that of the US credit standing. This has occurred up to now additionally, he mentioned.

The influence on the inventory markets is probably going to be unfavourable however not giant because the US economic system is now headed for a tender touchdown and never a recession, as markets feared earlier, he added.

US 10-year yield rising above 4 per cent and the greenback index appreciating to 102 are unfavourable for rising markets. Also, indicators like PMI from the Euro Zone and China recommend slowdown in these economies.

In temporary, the financial backdrop is unfavourable. Investors might wait and look ahead to the mud to settle earlier than leaping to purchase on dips, he mentioned.

(With inputs from IANS)